US Justice Department dissolves unit dedicated to crypto enforcement

• The US Department of Justice is closing a unit dedicated to cryptocurrency enforcement actions.
• US Deputy Attorney Todd Blanche reportedly stated that the DOJ is not a crypto regulator.
• Blanche added that the department will prosecute individuals who victimize digital asset investors rather than pursue cases against crypto companies.

The US Department of Justice (DOJ) discontinued its cryptocurrency enforcement unit on Tuesday. The department broke the news to its staff members via a memo that urged the prosecutors to begin tackling criminal cases involving digital assets rather than targeting crypto companies.

DOJ disbands crypto enforcement unit, gives new directive to staff members

The US DOJ ended its unit dedicated to crypto investigations and enforcement, according to a memo shared with its staff. US Deputy Attorney Todd Blanche issued the memo stating that the National Cryptocurrency Enforcement Team (NCET) would cease operations, Fortune first reported on Tuesday.

Blanche stated that the Justice Department is not responsible for regulating digital assets. He urged that the NCET be disbanded immediately, highlighting the DOJ's efforts to comply with President Donald Trump's support for digital assets. 

He also explained that the previous presidential administration under Joe Biden used the DOJ to target the crypto industry through a "reckless strategy of regulation by prosecution."

Blanche instructed the DOJ staff to prioritize prosecuting individuals who defraud digital asset investors or use crypto for criminal activities such as terrorism, organized crime, hacking and human trafficking.

The memo further stated that the DOJ would no longer pursue cases against crypto exchanges, wallets, and mixing and tumbling platforms, as it had previously done. Blanche requested that the department close cases that don't comply with the new strategy.

The decision to shut down the DOJ's crypto enforcement unit marks another move by the Trump administration to scale back the previous administration's regulatory actions against companies.

The NCET was a joint task force consisting of prosecutors from the DOJ's money laundering and cybercrime divisions and attorneys from various district offices.

The team played a key role in several major crypto-related cases, including the prosecution of Tornado Cash, Binance and BitMEX co-founders. NCET also led investigations into North Korean-related crypto laundering schemes from hacks.